The TFSA : one of the best tax shelters

The TFSA : one of the best tax shelters (1 min 50 s)

Added on
September 21, 2015

Description

The TFSA is undoubtedly one of the best tax shelters and it's becoming increasingly popular with Canadians every year. The advantage that comes with a TFSA, is to earn tax-sheltered income through your
investments.

The TFSA : one of the best tax shelters (1 min 50 s)

Do you really know the full potential of a tax-free savings account, also known as a TFSA?

Here are some tips to help you get the most from your TFSA.

The TFSA is undoubtedly one of the best tax shelters and it's becoming increasingly popular with Canadians every year.

If you have a TFSA, here are some things you should know about the latest in the line of investment vehicles. The more you know, the more you can get out of your TFSA!

First of all, you need to know that the main advantage of the TFSA is that the income you earn from your investments will not be taxed.

However, a number of investors use the TFSA as a savings tool, rather than an investment tool and often miss out on this advantage.

The thinking behind investing is to make your savings grow by choosing investment products that are suited to your goals, investment horizon and risk tolerance.

The TFSA gives you flexibility to make withdrawals without being penalized. What's good about this is that any withdrawals you do make will free up TFSA contribution room for the following year. Your gains can actually increase your contribution room.

What's not so good about this possibility is that if you make frequent withdrawals, you'll clearly generate less income. You'll be losing the advantage that comes with a TFSA, which is to earn tax-sheltered income through your investments.

And If you won't be using the amounts you've invested in your TFSA until you retire, make sure you put in place the retirement strategy that best suits your needs.

Your Desjardins advisor will be able to discuss the other aspects of the TFSA with you and will help you choose the best strategies to meet your financial objectives.

If you have any questions, please email me at the address you see on the screen. Until next time!